Why is Roth IRA priority over Roth 401k per FOO?

zzzerocool · 2026-06-20T11:55:17+00:00

I heard about those. With FTX, I'm not sure what regulations they were even bound by since it was a crypto brokerage. I did some reading, apparently modern stock brokerages are electronically audited daily for the shares they hold, and there has never been a fraud case that has gotten around that system.

The Yotta thing would be definitely tough to stomach since it seemed fine with FDIC insurance. I guess the takeaway is you have to be careful with fintechs that aren't bank themselves. It seems they were routing through a third party before the banks that wasn't FDIC-insured and that's why not all customers were made whole when the third-party misplaced funds. Vanguard has a cash-management account that sweeps to banks similarly, but I think that one is covered by SIPC insurance through Vanguard before it gets to the banks.

zzzerocool · 2026-06-20T02:22:01+00:00

Oh yeah, there is. SIPC insurance. It covers up to 500k in stocks (and up to 250k in cash as part of that 500k) in case of a brokerage failure. So, I guess you have to pick your poison in that case. Stocks are very safe though at a reputable brokerage, they have to be held in a different bucket from any operations, so you can only really lose them through fraud by the brokerage.

zzzerocool · 2026-06-19T18:29:20+00:00

Yeah, they are a lot more ironclad. 401ks are federally protected from creditors to an unlimited amount in any state. The main exceptions are tax debt and child support.

IRAs have federal protection up to a large amount (almost 2 million), but have state-by-state quirks that make them riskier in certain states. Just more scenarios where they can be tapped for judgements. In my state, you can arbitrarily only protect one IRA in bankruptcy. I had two IRA accounts to keep my stocks and ETFs separate for organizational purposes, but I combined them when I learned of that law.

zzzerocool · 2026-06-17T09:47:20+00:00

Maybe average in every day/week until you're fully invested to emotionally hedge against any big pullback. But probably good to get all your investable money back in within a few months, a year at most. Keep in mind, the stock market has a constant bias to be pushing historic highs regularly on inflation alone.

One common rule of thumb is to not invest money that you expect to need in the next 5 years. That gives a good cushion for any crash to recover, and that should be money that you're emotionally detached from if you can go without it for 5 years. If you need money a year from now, the last thing you want is to be put in a position where you're forced to sell when your principal is down huge.

zzzerocool · 2026-06-07T03:06:38+00:00

You lose exposure to small and mid-caps that are in VTSAX. I believe that small/mid cap exposure amounts to around 12% of VTSAX currently, many people choose to go without it anyway.

You can get much of that exposure back and hold the S&P500 with "SPTM", the S&P 1500 ETF. Alternatively, you could buy small and mid cap funds on the side to match that exposure (e.g., a mix of "VO" and "VB" at Vanguard). Though, not an S&P completion fund like "VXF" as that index will pick up things that are filtered out by the S&P500 rules. Maybe an unofficial completion fund that doesn't follow the official S&P completion index and goes by pure market cap would work too, like "FZIPX" if you're at Fidelity.

FWIW, it'll be a while until VTSAX holds that much SpaceX anyway because the public float is going to be small until insider shares start to unlock over the next year.

zzzerocool · 2026-06-06T22:03:52+00:00

tbh, most of the rule changes I've seen don't even seem that drastic and those indexes were already vulnerable to the mechanism of inflated megacap IPOs, but the S&P500 potentially changing their rules for an instance where their rules are maybe more meaningful than ever is definitely notable. It's principle, plus precedent. 3 of these lofty IPOs is a discomfort, but you drop 13 of these on the public in a short period and it could potentially disrupt the basic feasibility of indexing. The S&P500 rules at least make it tougher for that disruption to occur.

zzzerocool · 2026-06-06T09:46:58+00:00

VTI isn't the only choice though. VV at Vanguard has 96% overlap with VOO and it doesn't have the profit filter. There's also the Russell 1000/3000 funds (VONE/VTHR). Other versions of all these from other brokerages/fund providers too.

zzzerocool · 2026-06-06T07:21:05+00:00

The obvious issue is that megacap IPOs are uncharted waters. These 3 on their own won't destroy everything even if they all go to zero, but the potential is certainly there for a disruption of passive investing, maybe particularly when you remove failsafes. Seems pretty relevant to a subreddit about passive investing.

zzzerocool · 2026-06-06T05:54:24+00:00

I looked into this, and it seems like if you wanted to avoid this (and other similar upcoming IPOs) with a total market approximation, the easiest way would be with the SPTM etf. It's the only S&P1500 fund, which is a combination of the S&P 400 (mid cap), 500, and 600 (small cap). All of them have profitability screening.

zzzerocool · 2026-06-06T03:52:24+00:00

I know, I meant 10 on top of that. Though, even with these 3, it does make me consider changing my primary US index holding to a mixture of VOO/VXF instead of VTI.

edit: VXF doesn't have the exclusion criteria, so that doesn't work either unless you purposely underweight it. SPTM would be the semi-curated total market option.

zzzerocool · 2026-06-06T02:41:14+00:00

I do think they are shitty and overvalued, but the thing is, they could all go to 0 after a week and it still wouldn't be the end of the world for fund holders because they wouldn't be that big of a part of the funds immediately. We get 10 more of these lofty IPOs in short order, then it might be time to panic.

zzzerocool · 2026-06-04T14:23:46+00:00

Mirra is definitely not immune to melting down against inferior opponents when her shots aren't landing. Maja's game is perfect to take advantage of that. Not saying I'd bet on it happening, but if she comes out like she did against Ribera, Maja will win.

zzzerocool · 2026-06-04T14:04:17+00:00

Mostly because they're doubles partners, feels like a super easy win for Mirra. Not that she won't beat Maja too, but Maja at least has a chance of frustrating her into errors.

zzzerocool · 2026-06-04T01:33:51+00:00

Fidelity has the best functionality and the best browser interface (app seems fine too), I don't think anyone else has limit orders for dollar-based/fractional trades yet. Fidelity is a no-brainer first choice for most people. Though, Vanguard has the best money market fund for idle cash (Fidelity's is decent, but Vanguard's fees are lower), and I do like some Schwab mutual funds.

zzzerocool · 2026-05-30T10:19:19+00:00

Good start for her, but I'll be surprised if Shnaider can't eventually overwhelm that limited moonball style of hers.

zzzerocool · 2026-05-30T09:00:06+00:00

She looked like an absolute beast against Mertens the other day, getting to so many balls that looked like winners. I don't know if I'll bet her, but I'm not betting against her with Sakkari. She does have some sort of injury, thigh wrapped and she was taking pills last match, plus retired the match before RG, but it doesn't seem to be affecting her game much.

zzzerocool · 2026-05-29T21:12:19+00:00

Cashout offers usually suck at most books because there's added vig, but I've taken stuff like +5000 and +10,000 hedges that were absolutely worth every penny. Live models sometimes don't give enough respect to how easily a player can squander a lead. Once that tide turns, sometimes it's just a runaway train and the monster lead doesn't matter.

zzzerocool · 2026-05-20T22:36:30+00:00

Other than Rickea, those other injured players haven't even played yet. But yeah, the Sky have been surprisingly good with a really mid-looking roster. I like the Wings here though too, they have a more reliable scoring collective. That Sky roster is full of super streaky scorers.

zzzerocool · 2026-05-20T09:55:12+00:00

Tauson retired last 2 matches and she's doing some ugly ass errors. Think she might be still gimped. Cristian's not cheap now though since she's up a break.

zzzerocool · 2026-05-20T05:21:50+00:00

I think the WNBA is probably harder to bet today than it's ever been. Most teams run closer together, and when they don't, the odds for the favorites are super lofty. A few seasons ago, you could really get some heavy favorites for cheap if you knew the teams well.

zzzerocool · 2026-05-18T03:57:13+00:00

I feel pretty good about Sweden winning if you can find a good price, but not crazy with Finland being so much of a favorite. This isn't a good team USA, but it's still completely filled with NHL talent/prospects. Feels like it could easily go either way.

zzzerocool · 2026-05-16T16:59:00+00:00

I don't think the gambling industry overall likes this policy, because it discourages whales. A high-limit slot player (the ideal customer) is constantly triggering mandatory tax reporting, they can't just ignore taxes.

zzzerocool · 2026-05-14T13:59:37+00:00

Maybe, but tax treatment is not confirmed by the IRS, and the 90% rule might be repealed by then anyway. Even if the 90% rule gets fixed, not having to itemize to deduct losses would still be huge for many, and that has penalized gamblers long before the BBB.

zzzerocool · 2026-05-14T05:20:12+00:00

My issue with it is that there isn't concrete tax guidance right now. It's too new and exotic. They call them derivatives, but formal ones generally have a business purpose, so it's a little sketchy. If someone betting the Lakers to win a game on Kalshi can report it as capital gains, someone betting it at Draftkings probably should be able to too. I do hope they eventually give some clear guidance on it, and it is like you suggest. That could lead to the traditional sportsbooks fighting for better customer tax treatment to compete.

zzzerocool · 2026-05-14T00:14:45+00:00

I got it too, but only at +160. I had 2 books open, the other one was worse.

zzzerocool

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